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What's the Buzz About Buzz Marketing?: Knowledge@Wharton (http://knowledge.wharton.upenn.edu)
What's the Buzz About Buzz Marketing?
Published: January 12, 2005 in Knowledge@Wharton
There's a new marketing catchphrase that's getting rave word-of-mouth
reviews. From articles in the popular press to conversations in the
classroom, huge companies to boutique marketing firms, suddenly it
seems you can't talk about new products without addressing 'buzz
marketing.' "People are buzzing about buzzing," says Wharton
marketing professor Barbara Kahn. "People think it's cool. There is
something almost empowering about the idea of being able to 'buzz'
your way into the products people buy."
Buzzing: What Is It?
Put simply, buzz marketing is the practice of gathering volunteers to try products, then sending them out
into the world to talk up their experiences with the people they meet in their daily lives. The idea is that
the more people see a product being used in public, or the more they hear about it from people they
know and trust, the more likely they will be to buy it for themselves. Of course, word-of-mouth has long
been the way that many people find their favorite products, or learn about a new favorite movie, book or
restaurant. "For years, people recognized the power of word-of-mouth in convincing, influencing,
affecting consumer behavior," says marketing professor Jerry Wind. "It has more credibility than
traditional advertising." But it's a fairly recent development for companies to try to create a structure
around the practice, to harness and direct the way that word-of-mouth spreads -- and to attempt to
measure its effect on sales once the 'campaign' is complete. "Buzzing isn't really new. The hype about
these different kinds of buzz agents is what's new," says Kahn.
In practice, buzz marketing can take several different forms. Some companies identify particular types of
people to do their buzzing for them. Known as 'mavens' (for readers of Malcolm Gladwell's Tipping
Point) or 'influencers' or 'early adopters,' these are the people who naturally set cultural trends, who
define what is cool before the rest of the world even realizes it exists. "Gladwell put it in terms that
everyone understood, but basically there are people out there who can tell what's cool and what's not. We
all know them -- the people who tell us about great restaurants, or who have cool clothes before we do,"
Kahn says. "To make buzzing really work, I do have to believe that the person I'm listening to is
discriminating, that he or she knows something I don't. Otherwise that person is not giving me anything
new." Procter & Gamble pioneered this approach on a large scale by recruiting hundreds of thousands of
'maven' teenagers to create buzz about new products -- some as mundane as toothpaste. "P&G started this
idea of manufacturing word-of-mouth," says Wind. "They recruited a quarter million teens to talk about
their products. Now they are in the process of recruiting mothers to do the same thing because they have
suddenly realize that word-of-mouth is a powerful thing."
Other buzz marketers rely less on natural trendsetters and more on 'connectors.' "If they really want
something to spread -- to see not just a slow diffusion but a big jump in awareness -- you go to the
connectors," Kahn says. "Oprah is the king of all connectors. Basically these are people who have bigger
rolodexes than the rest of us. They have lots of contacts in different circles, so word will spread. Fast."
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But Does It Work?
Buzz marketing stands in direct contrast to traditional television or radio advertising -- the classic 'mass
marketing' approach that is based on the premise of broadcasting a message as widely as possible,
assuming that this is the best way to reach the largest possible number of interested consumers. Buzzing,
which might also be described as 'micro-marketing,' assumes that a person-to-person marketing message
is much more powerful because it is so personal -- and that it could potentially reach more people than a
broadcast message, if only it is buzzed about in great quantity by people who have very long contact lists
and no qualms about promoting products to anyone who will listen.
Wind points to a survey performed by CNW Marketing Research on the 15 largest U.S. television
markets as evidence of why buzz marketing is becoming so important to companies today. It found that
more than half of the ads for cars, credit cards and pet-related products are ignored by television viewers.
In addition, 42% of ads about home products are ignored, as are 45% of fast food advertisements. The
numbers are far worse in the case of viewers with personal video recorders such as TiVo. For that group,
95% of fast food ads were skipped, as were 68% of car ads, 80% of pet product ads, and 94% of financial
product advertisements. "The 30-second commercial is becoming less and less powerful. We have to
realize that most of the money spent on advertising is being wasted, so advertisers have to look for others
sources and ideas for marketing their products," Wind says.
That's why Vespa turned to buzz marketers to ride its scooters around town and talk up their 'cool factor'
when they debuted, and why Ford loaned its new Focus cars out to buzz agents for the first six months of
its launch. In each case, companies looked for ways to gain high visibility and personal
recommendations through buzz.
Not every product can be effectively marketed by buzz agents, however. "It has to be an interesting one,"
says Kahn. "Products do have to live up to the hype, they do have to deliver. If these products aren't
delivering coolness, this will not over time be a credible method." According to Kahn, products that fit
this description are fashion items and items of cultural interest such as TV shows, books and movies -anything that connotes a sense of being 'in the know.' "They have to be products where value comes from
the social interaction," Kahn says. "What you wear, what movies you go to, what things you read -- these
are all influenced by social opinion. There are other things that I buy where I don't care what other
people think about them. I like Sweet Tarts. I don't really care what anybody else thinks about Sweet
Tarts. But I like to go to the 'in' restaurants, and I want to have read the book everybody's talking about. I
want to know what everybody's talking about around the water cooler."
The fear for buzz marketing is that, however successful it may currently be, the effectiveness of the
approach will inevitably be diluted through overuse and, dare we say it: too much buzz. "Right now it's a
very nontraditional practice which makes it exciting," says marketing professor Peter S. Fader. "But look
at pop-up ads and email marketing, which five years ago, when you saw them for the first time, seemed
interesting. Now they are at the point of tremendous annoyance. They went from clever, path-breaking
and really, truly creative to this incredible annoyance where now, people have just thrown out the baby
with the bathwater. And there is no question that buzz marketing is poised to go exactly the same way.
"Buzz marketing needs to be used very judiciously for it to remain effective," he adds. "Otherwise people
will become so skeptical and annoyed by it that they will become completely immune to the marketing
virus that [marketers] are trying to spread." Fader doesn't think companies will succeed in preserving
buzz marketing as an effective tool because they simply don't exercise restraint when they have
discovered a new marketing approach. And perhaps even more importantly, Fader says, they regularly
confuse useful marketing tactics for real marketing strategy.
"What people have to realize is that it's not a strategy; it's a tactic. That's an important distinction," he
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notes. "Buzz marketing is one of many elements that a company should be doing when trying to get a
new product out to market. It's a specialized tactic. But these days companies are relying on it too
heavily, losing sight of what they really should be focusing on: strategy." According to Fader, the buzz
about buzz marketing is analogous to the hype that surrounded the Internet in the late 1990s, when so
many companies mistook the web and its technology for a new business 'strategy' rather than the sales
and information channel that it is. "Your strategy is what your overall approach is going to be. It's
answering bigger questions such as, 'Are we trying to leak into the market slowly or are we trying to
explode into the market all at once?' For example, there are very different sales patterns for movies,
which explode, versus new MRI machines, which need to be eased into the market. Next, you ask things
like, 'Do we start with a high price and bring it down? A low price and bring it up? Do we advertise
slowly and spread out the message?' Those are strategic questions."
Once set on strategy, tactics come into play. "There could be a role for buzz building in both skim and
penetration marketing strategies," Fader says. But buzz marketing should be combined with other forms
of marketing to create a pattern of tactics that support the overall strategy. "It needs to be decided in
concert with decisions about what other forms of both traditional and non-traditional forms of marketing
should they be using, and exactly how much of the budget should they be spending on each form of
messaging. Too many companies are starting with tactics and backing into them as a strategy. I'm a little
afraid that people are loading onto particularly small bandwagons such as this and losing sight of the
larger, more important issue of resource allocation."
According to marketing professor David R. Bell, who conducted a study looking at retail purchase
patterns for online retailer Netgrocer.com, "in general, we should expect the 'buzz effect' to be most
prominent the first time a consumer tries a product." Netgrocer.com, he says, "ships nonperishable
groceries using FedEx anywhere in the U.S., so we took a look at their customer data to see how their
customer base evolved over both time and space." With traditional grocery stores, Bell says, customers
can all be found within a 10 mile radius of the store. For an online store that ships anywhere, one might
expect to see no geographic pattern at all. "What we found was that there were in fact very strong spacial
clusterings: New customers came from the places where existing customers lived. It demonstrated very
strong social contagion patterns - word-of-mouth. Your neighbor orders from Netgrocer.com, tells you
about it, and you decide to try it, too."
Bell, however, also discovered something else: Word-of-mouth apparently has a shelf life. "Before
people try something once, they don't have their own experiences to make judgments, so they will try
something based on what their social acquaintances tell them. But for repeat customers, there was no
spacial pattern at all because the decision to purchase again requires no input from others. You will buy
something if you liked it the first time. Period."
The Ethical Debate
For some, buzz marketing raises not just strategy questions, but serious ethical issues as well. In most
cases when marketers talk about buzz marketing 'agents' they mean regular citizens who have
volunteered to be product guinea pigs -- people who receive no financial compensation, but do get
products in advance of their release to the general public in exchange for a promise to talk them up if they
like them, and to provide feedback to companies about what they and others think. Sometimes, however,
marketers blur these lines in their effort to create buzz, hiring actors to pose as Average Joes, similar to
what Sony Ericsson did to promote one of its digital cameras.
Actions like these raise the question of whether there is something inherently unethical about buzz
marketing itself. After all, even those 'buzz agents' who are not monetarily compensated do receive free
products in exchange for their services, and few freely admit their status as agents to the people they are
buzzing to. For some, the ethical question amounts to just a vague twinge of discomfort when they
realize a friend's excitement over a new product is part of an orchestrated corporate effort to create buzz
on the street. For others, it raises the specter of a paranoid future where corporate marketers have
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invaded every last niche of society, degrading all social interaction to a marketing transaction, where no
one can be certain of anyone else's true opinions or intentions.
Wharton marketing professor Lisa Bolton is one of the hard-liners in the buzz marketing ethics debate. "I
realize not all buzz marketing is subversive. Sometimes it's just a case of getting people on the street and
getting the word out. But stealth marketing, where you don't know that something's part of a marketing
campaign because people don't identify themselves as such? I thinks it's wrong. It's unethical. Over the
long term, when people find out, they will feel deceived and betrayed. Ultimately, it will damage a
company's brand equity."
Bolton, who teaches consumer behavior at Wharton, recently discussed buzz marketing in her class.
During the discussion several students identified themselves as buzz agents for various boutique
marketing companies; some were currently aiding buzz marketing efforts for everything from
forthcoming books to new consumer products. Most students were intrigued by the idea of buzz
marketing, and few said they perceived any ethical conflict. "They claim that they only act as buzz
agents for products they truly like; therefore, they aren't lying when they praise them. They seem to
focus on what they are saying, not why they are saying it," Bolton says.
Still, the students don't identify themselves as agents unless directly asked and this is what makes the
difference, according to Bolton. "Whenever the buzz agent doesn't identify himself upfront as a marketer,
the customer interaction is deceptive and, therefore, unethical. Research in psychology suggests that
consumers are more readily persuaded when they do not know that the other person is trying to persuade
them. By not revealing their persuasive intent, the buzz agent is gaining an unfair advantage that
undermines social interaction. We usually assume that other people, in ordinary discourse, are not trying
to sell us something; when we know we are being marketed to, we can raise barriers to try and protect
ourselves," she says.
Bolton's students changed their tune a bit when she proposed this scenario for them to consider: "At one
point I said, 'So John, you're sitting in a bar and a cute girl chats you up and you're feeling like 'Oh wow,
this attractive person is talking to me.' It's only after she's gone that you find out it's a marketing ploy.
Suddenly they said, 'Yeah, I'd feel pretty bad, [like I had been] taken advantage of'. Because now they
are the victim."
Wind disagrees. "I don't see any ethical problem as long as the company provides the product to a person
and that person is totally independent in terms of saying whatever they feel about the product to the
customer. If we say, 'Here's the product and here's what to tell people,' then you're not allowing them to
really express themselves. That's when it undermines credibility," Wind says. "Consumers are more
sophisticated than people give them credit for. Buzz marketing is like sampling; it's simply providing
exposure to the product. You're not forcing them to buy anything; you're just exposing them to it. They
are not stupid. They will try it and if they like it, they will do more research and maybe buy it
themselves. It's useful. If they don't like it, they won't buy it."
Besides, adds Wind, relying on word-of-mouth marketing may actually force companies to create better
products. "Research shows that negative word-of-mouth is seven times more powerful than positive
word-of-mouth. This really forces people to have good products. Otherwise, when you turn people loose
to say whatever they want, you could be in real trouble."
"In the end it's about cutting through the clutter," says Bolton. "When everyone starts to do buzz
marketing, it will just add to the clutter. Then it will be about whoever has the most unique or effective
campaign, whether it's a buzz campaign or not. It will be about what works. The rest is just noise."
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